This document summarizes an article from the International Journal of Management that discusses issues and concerns of food processing manufacturing units in Jammu and Kashmir, India. The key points are: 1) Jammu and Kashmir has strong potential for food processing given its climate and production of fruits and vegetables but the industry is still nascent. 2) The article identifies several driving factors for food processing in the region including availability of raw materials, labor force, and growing consumer income. 3) However, the industry faces issues such as lack of adequate infrastructure, access to financing, and technical skills that hamper its growth. The entrepreneurs interviewed cited these as major concerns.

1. International Journal of Management (IJM), ISSN 0976 –MANAGEMENT (IJM)
INTERNATIONAL JOURNAL OF 6502(Print), ISSN 0976 – 6510(Online),
Volume 3, Issue 3, September- December (2012)
ISSN 0976 – 6502(Print)
ISSN 0976 – 6510(Online)
Volume 3, Issue 3, September- December (2012), pp. 160-168 IJM
© IAEME: www.iaeme.com/ijm.asp
Journal Impact Factor (2012): 3.5420 (Calculated by GISI) ©IAEME
www.jifactor.com
ISSUES AND CONCERNS OF FOOD PROCESSING MANUFACTURING
UNITS IN J&K
Dr. Saurabh
Asst. Professor, College of Management
Shri Mata Vaishno Devi University
Sub post office: Katra,
Jammu & Kashmir- 182320, E-mail: saurabh.sri@smvdu.ac.in
Abid Sultan
Ph.D. Research Scholar, College of Management
Shri Mata Vaishno Devi University
Sub post office: Katra,
Jammu & Kashmir- 182320
E-mail: abidsultan2012@gmail.com
ABSTRACT
The Food processing industry in J&K is in embryonic stage with immense potential for fruits,
vegetables and other eatable products. It can become of the source of industrial development in
the State. However, the industry growth has not been significant over the last few years. The
maximum focus of the government has been upon packaging and export of fruits and dry fruits.
The entrepreneurial motivation in the sector requires certain interventions to boost the industry.
The paper discusses the core issues of the industry based upon the interviews of various
entrepreneurs in food processing industry in the State of Jammu and Kashmir. The
entrepreneurs have started with zeal based upon the potential of the state and now they are
surviving their units at a status-quo. The topography of the state is conducive to support food
processing industry provided there can be some technical interventions as per the issues and
concerns identified in the paper.
Keywords: Food processing, J&K, issues, entrepreneurs
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INTRODUCTION
The growth of the world population is being accompanied by increasing urbanization and
employment opportunities including dietary transition towards convenience foods, fresh dairy
products and higher consumption of fresh fruit and vegetables (John & Rudi, 2008). As a result,
modern food systems based on packaged food production are growing at a very much
impressive rate. The changes in customer tastes and preferences have created a significant
demand for processed food such as packaged/convenient food, dairy products, value added
foods etc.
India is one of the growing nations in the world. Its economy has experienced rapid growth in
the last 2 decades. India has the second largest arable land of 161 million hectares and has the
highest acreage (55 million hectares) under irrigation. India ranks second largest food producer
in the world and has the potential to immerge the biggest with its food and agricultural sector
(Indian Processed Food Industry Opportunities Galore,2008).The total land under fruit and
vegetable cultivation in India is over 5.7 million and 7.8 million hectares respectively. The total
fruit production in India is over 63.5 million tonnes. India is the second largest producer of
vegetables in the world producing over 125 million tonnes of vegetables (Gavane, 2012).
However, India accounts for less than 1.5% of international food trade .The Indian food
processing industry ranks fifth in size and is estimated at more than US $200 billion. The food
industry in India is expected to grow to $310 billion by 2015.Of India’s total agricultural &
food produce only 2 percent is processed (Economic Times ,May,2010). Ministry of food
processing in its Vision 2015 document has estimated the processing level of perishable to
increase from 6% to 20%, value addition to increase from 20 % to 35% and India’s share in
global food trade to increase from 1.5 % to 3%.
Table no 1: Processing of Agriculture produce in different Countries
S.No Country Level of Food Processing (in %age)
1 China 20
2 Thailand 30
3 Brazil 70
4 Philippines 78
5 Malaysia 80
Source: Indian Processed Food Industry Opportunities Galore,2008
In a population of 1.22 billion India has a strong 31.4 million middle class households or 160
million individuals. By 2025-26 the number of middle class households in India is likely to
reach 113.8 million households or 547 million individuals. The percentage of the middle class
in the country's total population will increase to 20.3% by 2015-16 and 37.2% by 2025-26
(Hindustan Times,Feb.,2011). According to Global Food & Drink Sector Review (2009), “300
million Indian consumers currently purchase processed and packaged food. This population is
expected to grow to 500 million in the next five years (2014). This extraordinary expansion will
drive growth in the food processing industry at almost 20% each year”.
Domestically, the spending on food and food products amounts to nearly 21% of the gross
domestic product of the country and constitutes the largest portion of the Indian consumer
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Volume 3, Issue 3, September- December (2012)
spending more than a 31% share of wallet. The food processing industry contributes 7 percent
to India’s GDP and provides employment to about 13 million people directly (Food Processing
Sector in India, 2012).
Though the food processing industry of India is quite large but it’s at infancy stage which
requires lot of development both in terms of infrastructure and management. India can capitalize
on this huge market and growing industry by focusing attention towards the states having strong
advantages in terms of climate and soil. States like Jammu & Kashmir can contribute a lot
towards the development and growth of the food processing industry in India.
JAMMU & KASHMIR
The strategic geographical location of Jammu & Kashmir is a blessing for the state’s economy.
Due to its geographical location, climate and soil type the state is the producer of rich variety of
fruits and vegetables. The state is the highest temperate fruit producing state of India (Farm-to-
Fork, 2010). The total area under fruit and vegetables in the state is 8, 74, 21,000 hectares
(Digest of Statistics, 2008-09). The fruits & vegetables of the Jammu and Kashmir state are
famous all over the world. The fruit industry is the second most important industry after tourism
in Jammu and Kashmir and probably is most ideal unparalleled area in the world for growing
temperate and dry fruits(Buyer-seller meet & conference, 2007).
The diverse agro climatic conditions of the state are an added advantage, which facilitate the
growing of the different kinds of fruits (Farm-to-Fork, 2010).The Agro climate of the can be
divide into four zones :
Table no 2: Agro climatic Zones of Jammu and Kashmir State
S.no Zone Areas Suitable Fruit Kinds
1 Temperate Zone Entire Kashmir Valley, Parts ofApple, Pear, Cherry,
Poonch, Rajouri, Doda, Kishtwar,
Walnut, Almond,
Ramban, Reasi, Kathua and Chesnut, Strawberry,
Udhampur Stone Fruit Grapes,
Prunes, Kiwi etc
2 Sub-Temperate Parts of Jammu Province, Uri & Peach, Plum, Apricot,
Zone Karnah Tehsil in Kashmir Pears, Pecan Nut, Olive ,
province Kiwi etc
3 Sub-Tropical Zone Jammu, Samba , Parts of Reasi, Mango, Citrus, Litchi,
Parts of Doda, Parts of Rajouri Guava, Grapes, Ber
Aonla
4 Arid Temperate Districts of Leh & Kargil Grapes (Raisin type),
Zone Prunes Apricot (drying
type), walnut, Currants
etc
Source: Farm-to-Fork ,2010
The rich produce of fruits and vegetables can be a great input for the growth and development
of the food processing sector. The total fruit production of J&K during 2008-09 was 16.91 lakh
metric tonnes comprising of 15.30 Tonnes of fresh fruit and 1.61 lakh metric tonnes of dry fruit.
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Volume 3, Issue 3, September- December (2012)
The export of the fruit outside the state was 11.61 lakh metric tonnes (Digest of Statistics, 2008-
09). Despite of various potentials the industry still lacks confidence to leverage out of the
opportunities of development. The paper deals in identifying the various driving forces of food
and beverages manufacturing units and concerns of the entrepreneurs in J&K.
METHODOLOGY
For the purpose of identification of various driving forces and issues, the research design chosen
is exploratory in nature. The objective of the paper is to identify some of the prominent issues
that hampers or can hamper the growth and development of the food processing industry in the
state along with the various factors that drive the opportunities for the industry. The research
used various facts and data available through secondary sources and used unstructured interview
method to identify the issues of 18 entrepreneurs in the food processing business in J&K.
FINDINGS AND DISCUSSIONS
J&K is a growing economy. The agricultural produce, specially fruits and dry fruits that
constitute the larger share of the basket have geographic brand identity as well as growing
production. Apart from these the improving education level, standard of living as well as status
of development and infrastructure they assist in the growth of the sector. The various driving
forces for the Food and Processing industry are identified as follows:
1. Availability Of Raw Material
Table No: 3 Year wise production of Fruits in the State of J&K (Qnty. In Metric Tonnes)
S.no Year Total Fresh Fruit Total Dry Fruit Total Fruit Production
Production Production
1 2004-05 1217604 114257 1331861
2 2005-06 1280428 122798 1403226
3 2006-07 1373678 130333 1504011
4 2007-08 1477920 158283 1636203
Source: Digest of Statistics , 2008-09, Directorate of Economics & Statistics ,J&K
The Food processing industry requires the assurance of uninterrupted supply of raw material.
The state has witnessed a growth in the production of the fruits and dry fruits in last few years.
(Table 3)
2. Labour Force Availability
The state is at par with other northern States in India. The unemployment rate in the state is
nearly 51 percent and the employability of the people is nearly forty percent against national
average of fifty one percent. If trained the state has the workforce to support the state which has
a huge potential with natural endowments.
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Table No : 4 Labour Force Participation Rate (LFPR) in the Northern States
S.no State Labour Force Participation Unemployment Rate (UR)
Rate (LFPR) (Rural + (Rural + Urban) (in per 1000)
Urban) (in per 1000) (15 - 59 (15 - 59 years)
years)
1 Chandigarh 422 19
2 Delhi 477 8
3 Haryana 420 86
4 H.P 434 64
5 J&K 401 51
6 Punjab 440 111
7 Rajasthan 553 181
8 U.P 429 82
9 Uttarakhand 421 46
10 India 513 90
Source : North India Leveraging Opportunities for Accelerated Growth,CII,2012
3. Consumer Income
The purchasing capacity of the people in J&K has increased in recent years. Though the per-
capita income of the inhabitants have been low as compared to Delhi and Chandigarh in northern
part of India but still the income index of the state is ranked high as compared to Uttar Pradesh
and Rajasthan.
Table no : 4 Per Capita Income of the Northern Region States
S.no State Per Capita Income Rank in the Rank in India
(Rs) 2009-10 Northern Region
1 Chandigarh 91,598 1 2
2 Delhi 89.037 2 3
3 Haryana 55,214 3 6
4 Punjab 43,199 4 12
5 Uttarakhand 42,486 5 13
6 H.P 40,690 6 14
7 J&K 26,739 7 22
8 Rajasthan 23,653 8 25
9 U.P 16,411 9 30
Source : North India Leveraging Opportunities for Accelerated Growth,CII,2012
4. Social Infrastructure
With reference to the income the status of the living of the people in J&k has also been
improving over the period. The state has reasonable status of education and is ranked tenth in
Human development index. This can be construed as a readiness for the development and growth
of the state. In the income status of the state is poised at fifth rank along with reasonable per
capita income.
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Table no: 4 Ranking of Northern States as per HDI & its Constituents
S.no State HDI Health Index Income Education
Rank Index Index
1 Delhi 2 2 1 2
2 Haryana 9 11 7 11
3 H.P 3 3 4 4
4 J&K 10 16 5 13
5 Punjab 5 4 3 8
6 Rajasthan 17 13 16 22
7 U.P 18 19 18 20
8 Uttarakhand 14 16 13 9
Source : North India Leveraging Opportunities for Accelerated Growth,CII,2012
The parameters above indicate that the state has balanced status. It provides the advantageous
scope for the growth and development industrial sector in the state of J & K. However the
growth of industry can be a balanced growth if the advantages of the natural endowments
efficiently linked. The Food processing sector of J&K is a potential link both in terms of
consumption as well as deployment of young resources. The industry is impending to create
market for its product at regional, national as well as for the international level. The industry at
present is surviving on the advantageous cues available, but for an accelerated growth there are
some core developmental issues. The issues have been identified with the help of unstructured
interviews of the entrepreneurs having Manufacturing/ packaging units in the Food Processing
Sector in J&K.
Some of the issues identified on the basis of the interview are:
1. Infrastructure
The food processing units require a robust support of infrastructure. With the regular
availability of quality raw material to the facility of transportation, storage and electricity
support are some of the key deliverables necessary for the industrial development. In J&K due
to unavailability of packaging and processing facilities, 30 per cent of the total fruit produced
get wasted(Buyer-seller meet & conference, 2007) .The mismatch between the production and
post-harvest management is one of the concerns for the food processors. The post-harvest loses
in fruits Varies from 25-35% (Food and Agri Processors Conclave,2011 ) .This loss is mainly
due to inadequate infrastructure in form of poor storage and transportation factors. The presence
of limited cold storage facility in the state is creating a lot of problems for the unit holders.
There are just 19 cold storage facilities in J&K with the capacity of 42869 Metric Tonnes (Cold
storages in India, Indiastat). While as, the total production of fruits 16.91 lakh metric tonnes
during 2008-09.
The connectivity is one of the biggest issues of the food processing industry in Jammu and
Kashmir. The geographical conditions and Hilly terrain hampers the connectivity of the state
with rest of the India round the year (Food and Agri Processors Conclave, 2011).
The food processing sector is technology driven industry relying heavily on the electricity. The
electricity is one of the important factors of production in the food processing. The electricity
demand and supply gap in the state is creating a lot of problems for the units. The state has huge
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potential of electricity around 20000MW. But the state has so far been able to generate around
750MW. The state requires total 2200 MW of electricity while as it is able to produce only
750MW (Greater Kashmir, May, 2010). Although the gap is fulfilled through the Northern grid
but the availability of round the clock supply is still a distant dream.
2. Quality Management/Testing/Accreditation
Quality is the most important attribute of the processed food. Quality certification of all types of
packaged fruit/ food items by Quality Control/ Analysis Laboratories is an essential component
of food control system to protect health and safety of domestic/ international consumers. The
state of Jammu and Kashmir doesn’t have any such facilities on sufficient basis. The
Government of India has established Food Quality Control/ Analysis Lab at Indian Institute of
Integrative Medicine, Jammu (Greater Kashmir, August,2012).The lab offers undertakes testing,
quality control & offers consultancy/ licensing services with regard to plants, drugs, water,
fertilizers, metal residues and pesticides residues etc. But the IIIM facility is insufficient to meet
quality control testing/assurance requirements of horticulture producers & food processors
scattered all over the state (Greater Kashmir, August,2012).Also the reach-ability of such
services to the difficult spread and terrains to the manufacturing units is limited. Some of the
units have their own testing labs o maintain the quality, but the reliability and accreditation is
still an area of concern. Thus another area of concern that needs attention of is Quality
Management/Testing/ Accreditation.
3. Marketing Support
The Food Processing Sector of Jammu and Kashmir is at its infancy stage. The sector needs the
care and support of state government for its expansion and growth. According to the President,
Kashmir Chamber of Food Processing Industry (KCOFI), Dr Zain-ul-Abidin,” Government is
providing marketing support to other sectors in one way or the other, but it provides no support
to the food processing industry of the Valley. Further, there are no proper schemes for the food-
processors in the Valley. Also the support at central level is not very much impressive. Director
General of Foreign Trade (DGFT) is to provide marketing support to the unit holders all over the
country, but the food processing sector is not included in DGFT, where as many other sectors are
included, like those of furniture, glass, plastic products, iron-based products, fabrications and
others”( Greater Kashmir, Feb.,2009).
The state government provides support to the various industrial sectors through two modes.
Firstly, through various schemes and incentives, secondly through SICOP (Small Scale
Industries Development Corporation Limited), this is a designated agency of the state
government for providing marketing support to the various industries of the state. Through
SICOP, the government is providing support to the steel, wood-based and other industries, but
one could not trace any significant policy support specifically for the food processing industry.
4. Lack of Technology Awareness
On interview of the entrepreneurs involved in processing and packaging of food products it was
found that the traditional methods are being utilized in processing and tracking the products.
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One of the reasons for this is the poor technological awareness among the entrepreneurs and the
youth (Food and Agri Processors Conclave, 2011). The state has Multiline food processing
training centre sponsored by MOFPI at SKUAST Kashmir. The centre was established in 2001.
The centre provides training about the food and vegetable processing. But the reach of the
centre is very much limited. A single centre to cater the needs of the three regions of the state
seems to be short of hand.
CONCLUSION
The status of food and processing manufacturing units is in nascent stage. The industry required
a comprehensive support of various government as well as non government agencies. The
infrastructure building in terms of road connectivity, electricity availability and cold storage
facilities needs an immediate attention of the State government. For the efficient and effective
infrastructure on the Public Private Partnership (PPP) basis can be very much beneficial to the
state.
The quality assurances can be ensured by establishing the quality management policy both at the
organizational level and as well as the governmental level. These recognized/ accredited
laboratories should be easily accessible to producers of fresh/ dry fruits and processed foods who
may seek certification of quality of their products against affordable charges/ fees and well in
time. Exploring avenues of bringing labs to land would be some innovative implementations
where the IIIM and SUKAST can focus. These laboratories in addition, accreditation of the
laboratory by an appropriate accreditation agency within the country or from outside, shall
enable the laboratory to improve its performance and to ensure reliability and accuracy of results.
Quality assurance and testing labs will pave way for the market expansion of the food processing
units of the state of Jammu & Kashmir. Beside, this it will also monitor quality of state’s
agricultural/ horticulture produce entering national/international trade. Thus, simultaneously
helps in building the brand image of the products.
The technological awareness needs to be developed in the state. Training cum awareness
programs for the existing unit holders can be conducted so as to develop the technology
awareness among the entrepreneurs. Also workshops can be conducted for the youth, educated
graduates and professional graduates to highlight the technological advancement in the field of
the food processing and also to make them aware about the growth and prospect in this industry.
Such awareness programs can be held with the support of MSMEDI, NABARD, Educational
Institutions, SIDCO, SICOP etc.
The state government needs to develop the special schemes, policies and incentives for the
development and growth of the food processing sector of Jammu and Kashmir. The government
can link its various schemes and programs with the food processing sectors. The food processors
can supply pulses, edible oils, milk, bread, Jams, Pickles, etc. to the schools/ offices coming
under the various government schemes. Food processing industry requires a strategic technical
intervention. The nurturing, support and collaborative at this stage will create opportunity of
development with synergetic effect.
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